Climbing Mountains and the index of a stock exchange has one thing in common - support levels. The whole idea is to climb till one point, rest for a while and then move ahead. Similarly, Indian Stock markets have been behaving like rock climbers. Breaking barriers, getting to a high , settling down in low energy for some time, gaining faith and then searching new sky and then reaching new heaven. So whats the whole debate about ?

The markets are just currently prevailing in their low energy state where the fat lady is just dancing along the 19k mark and not exactly singing. Would 20k be the next support level or actually it will trigger a search for a rational support level. Mauritius Investment SOP, FED rate cut and FII - would it actually sustain the market in its high state of anxiety once it cross the 20k mark?  Would the american economy carry on weaking?

Looking at the fundamentals of the economy - accepted a part of it can be attributed to growing corporate profits. Its coming on age when we are seeing firms originating from this country making acquisitions abroad but again looking at the grass route whats fueling these acquisitions? Its easy, propelling markets, liquidate 2~5% equity ,raise irrational amounts of money, acquire soft targets, achieve economies of scale, make profits.

But is the stock market growth commensurate in growth on countries infrastructure which currenly ranks poorly on ADB reports with dismal number of 6-lane highways, poor transit international airports. The money is neither manufacturing driven . When US economy is weaking , whom will they ‘call’ and sell their products? Its recession there, they arent buying !  Export incomes are also shrinking seeing a weakening dollar.

Given these points I am sure the article is not open to debate.

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